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BPT was recently trading at $21.70 and has an implied volatility of 11.35% for this period. Based on an analysis of the options available for BPT expiring on 15-Jun-2018, there is a 68.27% likelihood that the underlying will close within the analyzed range of $15.66-$30.82 at expiration. In this scenario, the average linear return for the trade would be 94.16%.

Upside potential: This synthetic long position offers the same potential benefits and liabilities as a long stock position, but at a discount due to the significant premium at-the-money puts are trading at over calls. In this case, the put position is opened at a strike of $22.50, which is already $0.80 in-the-money. However, its sale more than offsets this moneyness and the cost of the long call that the trade results in a net credit of of $4.80 per share. The final position can be considered as having a discount of $4.00 per share over the underlying price of $21.70 for a 18.43% total.

Downside risk: This discount is generally a sign of the stock facing considerable short pressure, and may indicate that the stock has become hard to borrow. However, if you have a long view of the underlying over this period, it could be a good opportunity to benefit from the upside at a major discount.